The Future of LNG

A blessing and a tragedy: Petronas’ recent decision to pull out of a $36 billion liquified natural gas (LNG) project planned for northern BC has been hailed as both in the mainstream media.

Closer to home, those on both sides agree: In the wake of the Malaysian energy giant’s retreat, northerners need to come together and advocate for our region’s future.

The natural gas pipeline would have come with an $11 billion terminal at Lelu Island, just south of Prince Rupert, where adjacent Flora Bank provides critical habitat for juvenile fish leaving the Skeena watershed. While it could have created 4,500 construction jobs and up to 400 permanent positions, the company expected to rely heavily on foreign workers, blaming a Canadian skills shortage in the project’s final two years of construction.

“We dodged a bullet with this project,” Skeena Watershed Conservation Coalition executive director Shannon McPhail says. “It was the single biggest threat to wild salmon and also the local economy.”

The recent boom and subsequent bust caused by the LNG furor has left some residents financially overextended after mortgaging homes and starting businesses.

Lucy Sager knows the scenario all too well. The Terrace resident was living her “dream come true” running Out Spoke’N Bike and Sport when Eurocan paper mill closed in 2011. “I didn’t realize how dependent I was on industry until Eurocan closed,” she says.

When her business closed shortly after, starting over meant working three jobs, which led to a position managing Enbridge’s public relations office. An advocate for LNG, she now runs Spirit Strategies, a consulting company that works as a liaison between First Nations and industry.

“A lot of people are super disappointed about Petronas leaving,” she says. “Love them or hate them, they dumped money into Shames Mountain, they dumped money into trails, they dumped money into cleaning up our shoreline.”

While Sager and McPhail can find a lot to disagree on, a heated exchange on social media recently led them to discover what they have in common: a desire to generate local jobs that suit the region culturally, environmentally and economically. The pair decided to meet and join forces.

“Right or wrong, people made plans and it’s like, ‘now what?’” Sager says. “I’m all ears.”

With depressed fuel prices blamed for Petronas’s decision, the future of LNG in the region is uncertain. Shortly before the announcement—though likely long after the decision had been quietly made—a northern BC resident’s legal victory put a further damper on similar projects.

Mike Sawyer sensed some incongruities during a presentation about TransCanada’s Prince Rupert Gas Transmission Project. Evasive answers to his questions inspired the former environmental consultant to keep digging. He learned that a federal review, which should have been required, had been waived.

What followed was two and a half years battling the National Energy Board. In June, the Federal Court of Appeal found in Sawyer’s favour.

While it’s unlikely the decision played into Petronas’ announcement (most agree the final investment decision was based solely on economics and made well before the recent provincial election), it will hold other companies accountable when trying for environmental approval.

“I believe that citizens have an obligation to challenge the government when they make decisions that are either illegal, corrupt or not in the public interest,” says Sawyer, who also espouses the need for a regional plan that protects watersheds and wild salmon.

“If we just fight fires, we’re going to win some, we’re going to lose some,” he says. “We should come up with an end game plan so we don’t have to keep doing this, fire after fire.”

Fighting fires was what Skeena MLA Doug Donaldson was doing as word spread about Petronas’s decision, with BC’s unprecedented wildfire season keeping the new Minister of Forests, Lands, Natural Resource Operations and Rural Development occupied since taking on the position in July. He says the announcement offers some breathing room for regional discussion.

“The way the BC Liberals approached this file and jumped into it never enabled us to have a serious conversation about LNG in the Northwest,” he says. “That investment decision by Petronas gives us the ability to catch up a bit in the conversation about land-use planning.”

While not theoretically opposed to LNG, BC’s new NDP government has made it clear it only supports projects that offer a fair return for the resource, partnerships with First Nations, environmental protection, and jobs for local residents.

Sager speculates that the region might see the myriad proposed LNG projects filter into one that makes the most sense. At the moment, she points to LNG Canada in Kitimat and Nexen’s Aurora LNG on Digby Island as remaining possibilities, along with Chevron’s Kitimat LNG.

Ultimately, it will be up to northerners to speak up about what they want for the region’s future.